Indian online fashion market to hit $12-$14 billion by 2020, says BCG, Facebook report
Online fashion market in India is estimated to reach $12-$14 billion level by 2020, according to a report study by the global Boston Consulting Group (BCG) and social media giant Facebook.
While online fashion shoppers will more than double to touch the 130 million mark, fashion e-commerce will constitute 11-12 per cent of the total domestic fashion market, the joint study said.
Currently, 55-60 million consumers are buying fashion products online. While fashion market in India is currently estimated at $70 billion -- where online contributes five per cent at around $4 billion -- $30bn of this market will be digitally influenced by 2020.
"Fashion is at the forefront on Facebook in India. It dominates the top 10 interest categories on Facebook and same is true for Instagram," Umang Bedi, Managing Director, India & South Asia Facebook, told a news agency.
Bedi added that one out of every two Instagram users in India was interested in fashion.
"The spurt of new fashion shoppers will bring with it a fundamental shift in the profile of online fashion shoppers. The 2020 shopper will no longer be the typical young, metro-residing male of today," said Rohit Ramesh, Partner and Managing Director, BCG.
By 2020, nearly half the shopper base will be women, more than 50 per cent will come from lower tiers (Tier 2 or even lower) and 37 per cent will be older than 35 years of age," Ramesh added.
This shift in the online shopper profile will require e-tailers to rethink their offers across several dimensions, including assortment, pricing and discounts, delivery options and return policies.
"By 2020, 33 per cent of all urban fashion consumers will buy online, which means for a mobile-first country like India, we will witness a high number of purchases taking place on the mobile," added Bedi.
"Mobile has become central not just to the way brands market and sell, but also how they design products, plan merchandising and engage with customers end-to-end," Bedi said.
A key finding of the report is around the interplay of online and offline channels in consumer paths to purchase.
The online shoppers are using a number of channels to discover, research and purchase apparel.
As of today, only 10-15 per cent of ad spends are on digital media despite the magnitude of digital influence on fashion spends.
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